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Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
Managing Reputational Risk
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Managing Reputational Risk

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A simple approach to Reputational Risk Management

A simple approach to Reputational Risk Management

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  • 1. Managing reputational risk Eneni Oduwole Jan. 2009
  • 2. Contents
    • What is reputation?
    • Attributes of reputation
    • How can reputation be damaged?
    • What is reputational risk management?
    • Attributes of reputational risk management
    • Benefits of reputational risk management
    • Managing reputational risk
    • Rating reputational risk
    • Indicators of levels of reputational risk
  • 3. What is reputation?
    • It is :
      • an intangible asset
      • not a brand
      • the sum total of all stakeholders’ experience
      • public information regarding an organization’s trustworthiness
    • It also assures:
      • premium value growth opportunities to shareholders (value growth resulting from managerial experience, innovation, intellectual property)
      • continued comparative advantage
  • 4. Attributes of Reputation
  • 5. How can reputation be damaged?
    • Actions that result in stakeholders lose of trust and confidence
    • Public perception of organization’s standards drop
    • Sudden change of management; no succession planning
    • Adverse regulatory reports and sanctions
    • Increased incidences of fraud
    • Consistent unfavourable ratings
    • Continued decline in share price
  • 6. What is Reputational Risk Management?
    • It is the current and prospective impact on earnings and capital arising from negative public opinion
    • It measures the change in perception of a company
    • It is linked with customer expectations regarding an organization’s ability to conduct business securely and responsibly
  • 7. Attributes of Reputational Risk
  • 8. Benefits of Reputational Risk Management
    • Identifies key risks that can affect an organization's reputation adversely
    • Assesses potential impact
    • Ensures timely and appropriate response to adverse public criticisms
    • Enables a good work culture is promoted by Management
    • Ensures effective communication and disclosure to all stakeholders
    • Promotes commitment and trust between all stakeholders
  • 9. Managing Reputational Risk
    • Understand the value of the organization's reputation
    • Treat reputational risk management holistically; understand inter-relationships within the business
    • Have effective internal control & enterprise risk management frameworks
    • Identify and prioritize relevant risk factors; communicate key risk areas to Management
    • Ensure that an effective business continuity management plan is in place
    • Build a culture of recruiting excellent people and effective people management practices
    Value your Customers
  • 10. Rating Reputational Risk
    • Reputational Risk can be rated as:
  • 11. Indicators of levels of Reputational risk
    • Indicators of Low risks include:
    Management fosters a well supported sound culture across the organization Management fosters a well supported sound culture across the organization
  • 12. Indicators of levels of Reputational risk (co’td)
    • Indicators of Moderate / Medium risks include:
    Management fosters a well supported sound culture across the organization The firm adequately self-regulates its risks Losses from fiduciary activities are manageable (whether no. of accounts, volume of assets, increased litigation or customer complaints)
  • 13. Indicators of levels of Reputational risk (co’td)
    • Indicators of High risks include:
    Management fosters a well supported sound culture across the organization
  • 14.  

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